Title III-Housing and Other Credit Guaranty Programs 117

Sec. 221.118 Housing Guaranties.-The Congress recognizes that shelter, including essential urban development services, is 119 among the most fundamental of human needs. Shelter for most people in the developing countries consists largely of domestic materials assembled by local labor. While recognizing that most financing for such shelter 120 must come from domestic resources, the Congress finds that carefully designed programs involving United States capital and expertise can increase the availability of domestic financing for improved shelter 120 and related services for low-income people by demonstrating to local entrepreneurs and institutions that providing low-cost shelter 120 can be financially viable. The Congress reaffirms, therefore, that the United States should continue to assist developing countries in marshalling resources for low-cost shelter 120. Particular attention should be given to programs which will support pilot projects for low-cost shelter or which will have a maximum demonstration impact on local institutions and national policy. The Congress declares that the long run goal of all such programs should be to develop domestic construction capabilities and to stimulate local credit institutions to make available domestic capital and other management and technological resources required for effective low-cost shelter programs and policies.

Sec. 222.121 Authorization.-(a) To carry out the policy of section 221, the President is authorized to issue guaranties to eligible investors (as defined in section 238(c)) assuring against losses incurred in connection with loans made for projects meeting the criteria set forth in section 221. The total principal amount of guaranties issued under this title or heretofore issued under prior housing guaranty authorities, which are outstanding at any one time, shall not exceed $2,158,000,000.122 The authority of this section shall

117 Title III was added by sec. 105 of the FA Act of 1969. Sec. 8(a)(1) of the FA Act of 1974 substituted the title heading "Housing and Other Credit Guaranty Programs" in lieu of "Housing Guaranties".

118 22 U.S.C. 2181. Sec. 221, which was added by the FA Act of 1969, was amended and restated by sec. 115(a) of the International Development and Food Assistance Act of 1978 (Public Law 95-424, 92 Stat. 950).

119 The words "including essential urban development services, is" were substituted in lieu of the words "requirements are" by sec. 541(a) of the Foreign Assistance Appropriations Act, 1985, as contained in the Continuing Appropriations Act, 1985 (Public Law 98-473, 98 Stat. 1903). This amendment had been included as sec. 311(a)(1) of H.R. 5119, the International Security and Development Cooperation Act of 1984, as passed by the House on May 10, 1984. Sec. 541(a) enacted sec. 311 of H.R. 5119.

120 The word "shelter" was substituted in lieu of the word "housing" by sec. 541(a) of the Foreign Assistance Appropriations Act, 1985, as contained in the Continuing Appropriations Act, 1985 (Public Law 98-473, 98 Stat. 1903). This amendment had been included as sec. 311(a)2) of H.R. 5119, the International Security and Development Cooperation Act of 1984, as passed by the House on May 10, 1984. Sec. 541(a) enacted sec. 311 of H.R. 5119.

121 22 U.S.C. 2182. Sec. 222, which was added by the FA Act of 1969 and had concerned housing projects in Latin American countries, was amended and restated by sec. 115(a) of the International Development and Food Assistance Act of 1978 (Public Law 95-424, 92 Stat. 950).

Sec. 313(c) of the International Security and Development Cooperation Act of 1985 (Public Law 99-83, 99 Stat 190) added subsec. (k). This subsection should probably be labeled "(d)” instead of "(k)”.

122 This figure was increased from $1,958,000,000 by sec. 313(a) of the International Security and Development Cooperation Act of 1985 (Public Law 99-83, 99 Stat. 190). This figure was previously increased from $1,718,000,000 by sec. 541(a) of the Foreign Assistance Appropriations Act, 1985, as contained in the Continuing Appropriations Act, 1985 (Public Law 98-473, 98 Stat. 1903). This amendment had been included as sec. 311(b)(1) of H.R. 5119, the International Security and Development Cooperation Act of 1984, as passed by the House on May 10, 1984. Sec.

Continued

continue through September 30, 1990.123 The President may issue regulations from time to time with regard to the terms and conditions upon which such guaranties shall be issued and the eligibility of lenders.

(b) Activities carried out under this section shall emphasize—

(1) projects which provide improved home sites to poor families on which to build shelter, and related services;

(2) projects comprised of expandable core shelter units on serviced sites;

(3) slum upgrading projects designed to conserve and improve existing shelter;

(4) shelter projects for low income people designed for demonstration or institution building purposes; and

(5) community facilities and services in support of projects authorized under this section to improve the shelter occupied by the poor.

(c) In issuing guaranties under this section with respect to projects in a country which require the use or conservation of energy, the President shall give consideration to the use of solar energy technologies, where such technologies are economically and technically feasible. Technologies which may be used include solar hot water systems, solar heating and cooling, passive solar heating, biomass conversion, photovoltaic and wind applications, and community-scale solar thermal applications.

(k) 121 The total principal amount of guaranties issued under this section for each of the fiscal years 1986 and 1987 shall be comparable to the total principal amount of such guaranties issued for fiscal year 1984, subject to the dollar limitations on the issuance of guaranties under this section which are contained in subsection (a) and in appropriation Acts.

Sec. 222A.124 Agricultural and Productive Credit and Self-Help Community Development Programs.-(a) It is the sense of the Congress that in order to stimulate the participation of the private

541(a) enacted sec. 311 of H.R. 5119. Previously, the amount was raised from $1,555,000,000 to $1,718,000,000 by sec. 310(a) of the International Security and Development Cooperation Act of 1981 (Public Law 97-113, 95 Stat. 1535) and from $1,180,000,000 to $1,155,000,000 by sec. 112(a)(1) of Public Law 96-53 (93 Stat. 363).

Congress did not enact an authorization for fiscal year 1989. Instead, the Foreign Operations, Export Financing, and Related Programs Appropriations Act, 1989 (Public Law 100-461, 102 Stat. 2268) waived the requirement for authorizations and appropriated the following for "Housing and Other Credit Guaranty Programs":

During the fiscal year 1989, total commitments to guarantee loans shall not exceed $125,000,000 of contingent liability for loan principal: Provided, That the President shall enter into commitments to guarantee such loans in the full amount provided under this heading, subject only to the availability of qualified applicants for such guarantees

123 The authority of this section was extended from Sept. 30, 1988 by title II of the Foreign Operations, Export Financing, and Related Programs Appropriation Act, 1988 (sec. 101(e) of the Continuing Appropriations for 1988, Public Law 100-202, 101 Stat. 1329). It was extended from Sept. 30, 1986, by sec. 313(b) of the International Security and Development Cooperation Act of 1985 (Public Law 99-83, 99 Stat. 190).

The authority of this section was previously extended from Sept. 30, 1984, by sec. 541(a) of the Foreign Assistance Appropriations Act, 1985 as contained in the Continuing Appropriations Act, 1985 (Public Law 98-473, 98 Stat. 1903). This amendment had been included as sec. 311(b)(2) of H.R. 5119, the International Security and Development Cooperation Act of 1984, as passed by the House on May 10, 1984. Sec. 541(a) enacted sec. 311 of H.R. 5119. This authority had been extended previously from Sept. 30, 1982, by sec. 310(a) of the International Security and Development Cooperation Act of 1981 (Public Law 97-113, 95 Stat. 1535) from Sept. 30, 1980, by sec. 112(a)(2) of Public Law 96-53 (93 Stat. 364).

124 22 U.S.C. 2182a. Sec. 222A was added by sec. 8(a)(2) of the FA Act of 1974.

sector in the economic development of less-developed countries, 125 the authority conferred by this section should be used to establish pilot programs 126 to encourage private banks, credit institutions, similar private lending organizations, cooperatives, and private nonprofit development organizations to make loans on reasonable terms to organized groups and individuals residing in a community for the purpose of enabling such groups and individuals to carry out agricultural credit and self-help community development projects for which they are unable to obtain financial assistance on reasonable terms. Agricultural credit and assistance for self-help community development projects should include, but not be limited to, material and such projects as wells, pumps, farm machinery, improved seed, fertilizer, pesticides, vocational training, food industry development, nutrition projects, improved breeding stock for farm animals, sanitation facilities, and looms and other handicraft aids.

(b) To carry out the purposes of subsection (a), the agency primarily responsible for administering part I is authorized to issue guaranties, on such terms and conditions as it shall determine, to private lending institutions, cooperatives, and private nonprofit development organizations 127 assuring against loss of not to exceed 50 per centum of the portfolio of such loans made by any lender to organized groups or individuals residing in a community to enable such groups or individuals to carry out agricultural credit and selfhelp community development projects for which they are unable to obtain financial assistance on reasonable terms. In no event shall the liability of the United States exceed 75 per centum of any one loan.

(c) The total face amount of guaranties issued under this section outstanding at any one time shall not exceed $20,000,000.128 Not more than 10 per centum of such sum shall be provided for any one institution, cooperative, or organization.

(d) The Inter-American Foundation shall be consulted in developing criteria for making loans eligible for guaranty coverage in Latin America under this section.

(e) Not to exceed $3,000,000 of the guaranty reserve established under section 223(b) shall be available to make such payments as may be necessary to discharge liabilities under guaranties issued under this section or any guaranties previously issued under section 240 of this Act.

125 The words "in not more than six Latin American countries" and the words "in Latin America" were deleted by sec. 541(a) of the Foreign Assistance Appropriations Act, 1985, as contained in the Continuing Appropriations Act, 1985 (Public Law 98-473, 98 Stat. 1903). This amendment had been included as sec. 312(a)(1) of H.R. 5119, the International Security and De velopment Cooperation Act of 1984, as passed by the House on May 10, 1984. Sec. 541(a) enacted sec. 312 of H.R. 5119.

126 Previously such programs were limited to not more than six Latin American countries (Public Law 99-53, 99 Stat. 364).

127 The words "in not more than five Latin American countries", that previously appeared at this point, were struck out by sec. 541(a) of the Foreign Assistance Appropriations Act, 1985, as contained in the Continuing Appropriations Act, 1985 (Public Law 98-473, 98 Stat. 1903). This amendment had been included as sec. 312(a)(2) of H.R. 5119, the International Security and Development Cooperation Act of 1984, as passed by the House on May 10, 1984. Sec. 541(a) enacted sec. 312 of H.R. 5119.

128 This figure was increased from $15,000,000 by sec. 112(b)(2) of the International Development Cooperation Act of 1979 (Public Law 96-53, 93 Stat. 364).

(f) Funds held by the Overseas Private Investment Corporation pursuant to section 236 may be available for meeting necessary administrative and operating expenses for carrying out the provisions of this section through June 30, 1976.

(g) The Overseas Private Investment Corporation shall, upon enactment of this subsection, transfer to the agency primarily responsible for administering part I all obligations, assets, and related rights and responsibilities arising out of, or related to the predecessor program provided for in section 240 of this Act.

(h) 129 The authority of this section shall continue through September 30, 1988.130

(i) Notwithstanding the limitations in subsection (c) of this section, foreign currencies owned by the United States and determined by the Secretary of the Treasury to be excess to the needs of the United States may be utilized to carry out the purposes of this section, including the discharge of liabilities under this subsection. The authority conferred by this subsection shall be in addition to authority conferred by any other provision of law to implement guaranty programs utilizing excess local currency. 131

Sec. 223.132 General Provisions.-(a) A fee shall be charged for each guaranty issued under section 222 or 222A 133 in an amount to be determined by the President. In the event the fee to be charged for such type guaranty is reduced, fees to be paid under existing contracts for the same type of guaranty may be similarly reduced.

(b) The amount of $50,000,000 of fees accumulated under prior investment guaranty provisions repealed by the Foreign Assistance Act of 1969, together with all fees collected in connection with guaranties issued under section 133 222 or under prior housing guaranty authorities, 134 shall be available for meeting necessary administrative and operating expenses of carrying out the provisions of section 222 and administering housing guaranties heretofore authorized under this title and under 135 prior housing guaranty provisions repealed by the Foreign Assistance Act of 1969 (including, but not limited to expenses pertaining to personnel, sup

129 22 U.S.C. 2184.

130 This authority was extended from Sept. 30, 1986, to Sept. 30, 1988, by sec. 313 (d) of the International Security and Development Cooperation Act of 1985 (Public Law 99-83, 99 Stat. 190). This authority was previously extended from Sept. 30, 1983 to Sept. 30, 1986, by sec. 541(a) of the Foreign Assistance Appropriations Act, 1985 (Public Law 98-473). This amendment had been included as sec. 312(b) of H.R. 5119, the International Security and Development Cooperation Act of 1984, as passed by the House on May 10, 1984. Sec. 541(a) enacted sec. 312 of H.R. 5119. Such authority had previously been extended from Dec. 31, 1977 to Sept. 30, 1978, by Public Law 95-88 (91 Stat. 540), from Sept. 30, 1978 to Sept. 30, 1979, by Public Law 95-424 (92 Stat. 951), from Sept. 30, 1979 to Sept. 30, 1982, by Public Law 96-53 (93 Stat. 364), and from Sept. 30, 1982 to Sept. 30, 1983, by Public Law 97-438 (96 Stat. 2286).

131 Subsec. (j), which previously appeared at this point and concerned a one-time reporting requirement, was repealed by sec. 502(d)(1) of the International Development and Food Assistance Act of 1978 (Public Law 95-424, 92 Stat. 959).

132 22 U.S.C. 2183. Sec. 223 was added by sec. 105 of the FA Act of 1969.

133 Sec. 8(a)(3) of the FA Act of 1974 substituted "section 221, 222, or 222A” in lieu of "section 221 or section 222". Subsequently, the reference to sec. 221 was struck by sec. 115 of the International Development and Food Assistance Act of 1978 (Public Law 95-424, 92 Stat. 951).

134 Sec. 117(b)(2)A) of the International Development and Food Assistance Act of 1977 (Public Law 95-88, 91 Stat. 540) struck out the word "hereunder" and inserted the words "under section 221 or 222 or under prior housing guaranty authorities". See also footnote 135.

were substituted in

135 The words to this point beginning with "222 and administering lieu of "221 and section 222 of" by sec. 115(d)(2) of the International Development and Food Assistance Act of 1978 (Public Law 95-424, 92 Stat. 951).

plies, and printing), subject to such limitations as may be imposed in annual appropriation Acts; for meeting management and custodial costs incurred with respect to currencies or other assets acquired under guaranties made pursuant to section 222 133 or heretofore pursuant to this title or 136 prior Latin American and other housing guaranty authorities repealed by the Foreign Assistance Act of 1969; and to pay the cost of investigating and adjusting (including cost of arbitration) claims under such guaranties; and shall be available for expenditure in discharge of liabilities under such guaranties until such time as all such property has been disposed of and all such liabilities have been discharged or have expired, or until all such fees have been expended in accordance with the provisions of this subsection. Fees collected in connection with guaranties issued under section 222A 137 shall likewise be available to meet similar expenses, costs, or liabilities incurred in connection with the programs authorized by that section. 138 All of the foregoing fees referred to in this section together with earnings thereon and other income arising from guaranty operations under this title shall be held in a revolving fund account maintained in the Treasury of the United States. All funds in such account may be invested in obligations of the United States. Any interest or other receipts derived from such investments shall be credited to such account and may be used for the purposes cited in this section. 139

(c) Any payments made to discharge liabilities under guaranties issued under this title or 140 section 222 or heretofore under prior Latin American or other housing guaranty authorities repealed by the Foreign Assistance Act of 1969, shall be paid first out of fees referred to in subsection (b) (excluding amounts required for purposes other than the discharge of liabilities under guaranties) as long as such fees are available, and thereafter shall be paid out of funds, if any, realized from the sale of currencies or other assets acquired in connection with any payment made to discharge liabilities under such guaranties as long as funds are available, and finally out of funds hereafter made available pursuant to subsection (e).

(d) All guaranties issued under section 222 or 222A or previously under section 240 of this Act 141 or heretofore under this title or 142 under prior Latin American or other housing guaranty authority repealed by the Foreign Assistance Act of 1969 shall constitute obligations, in accordance with the terms of such guaranties of the United States of America and the full faith and credit of the

136 The words "this title or" were added by sec. 115(d)4) of the International Development and Food Assistance Act of 1978 (Public Law 95-424, 92 Stat. 951).

137 See page 67 for text.

138 This sentence was added by sec. 117(b)(2) of the International Development and Food Assistance Act of 1977 (Public Law 95-88, 91 Stat. 540).

139 The final three sentences of subsec. (b) were added by sec. 310(b) of the International Security and Development Cooperation Act of 1981 (Public Law 97-113, 95 Stat. 1535).

140 The words "under this title or" were substituted in lieu of "section 221 or" by sec. 115(e) of the International Development and Food Assistance Act of 1978 (Public Law 95-424, 92 Stat. 951).

141 Sec. 8(a)(5) of the FA Act of 1974 substituted "section 221, 222, 222A, or previously under section 240 of this Act" in lieu of "section 221 or section 222." Subsequently, sec. 115(f) of Public Law 95-424 struck out the reference to sec. 221.

142 The words "under this title or" were added by sec. 115(f)(2) of the International Development and Food Assistance Act of 1978 (Public Law 95-424, 92 Stat. 951).